That weighed on European and Asian markets, which were closed when the downgrades were announced.

London's FTSE 100 (UKX) closed 1% lower Friday, the CAC 40 (CAC40) in Paris was down 0.8% and the DAX (DAX) in Frankfurt slid 1.3%. But all three indexes managed to eke out gains for the week, although less than 1%. The Euronext (N100) index fell 0.8% on Friday, but it was also higher overall for the week.

The Hang Seng (HSI) in Hong Kong closed lower by 1.4% on Friday, down 1.2% for the week; while Tokyo's Nikkei 225 (N225) slipped 0.3% at the close but managed gains of 2.7% for the week. The Shanghai Composite (SHCOMP) was closed for a holiday on Friday, but was down 1.5% for the week.

Another day of weak data from Germany added to market pessimism on Friday.

Germany, a bastion of economic strength amid its mostly stagnant European neighbors, sends 60% of its exports to other European Union members. It is now feeling the impact from the surrounding malaise, Jones said.

"If you're going to have that much of a downturn in Europe, it's going to be felt in Germany, as well," she said.

The recession is certainly being felt in Spain, where the banking industry needs a cash injection of € 62 billion just to stay afloat, according to an independent audit published Thursday. After selling off Thursday, U.S.-listed shares of Banco Santander (SAN) and BBVA (BBVA) rebounded by more than 3% Friday.

On the domestic front, Wall Street rebounded after getting Thursday's nasty session out of its system. S&P 500 (SPX), Nasdaq (COMP) and Dow Jones industrial average (INDU) were all higher on Friday, making modest gains of less than 1%.